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Intel (NASDAQ:INTC) is in the midst of a multi-year turnaround, as it attempts to transition from focusing on data center and PC sales into a more well-rounded chip company. However, the chip giant’s near-term fortunes are still largely tied to the PC industry, which looks to be struggling, according to analyst Christopher Danely, of Citi.
On Monday, Danely kept his neutral rating on the Pat Gelsinger-led Intel (INTC) unchanged, even as February notebook shipments fell 11% month-over-month, well below the firm’s estimate of a 5% decline that was based largely on component shortages.
Danely called the notebook situation «another yellow flag» for Intel (INTC) after the company said on its last earnings call that it expects to see an inventory correction in the notebook market. Danely said he believes the situation is such that PC sales could «cool off» in the second half of this year following two-straight years of double-digit growth.
As trading progressed, Monday, Intel’s (INTC) were down by almost 3%.
In addition, Citi’s Taiwan notebook analyst, Carrie Lu, said she expects notebook shipments in the first-quarter fall 18% from the fourth quarter, due to «continued component supply tightness and logistic challenges.» Lu had earlier estimates notebook shipment to decline by 16% on a quarter-over-quarter basis.
Earlier this month, Intel (INTC) said its autonomous driving unit, Mobileye, had confidentially filed for an upcoming initial public offering.
Danely also said concerns about a possible economic recession, and fears about China invading Taiwan have turned the semiconductor market into «a den of bears» for investors.
